The legislature dives back into business this week and the next, with a packed agenda featuring a number of important bills and issues, starting with the presidential veto of a proposed VAT cut on electricity invoices.

On Tuesday the House finance committee will hold an extraordinary session to decide how to proceed with the president’s veto on a bill passed by opposition parties slashing VAT on electricity from 19 per cent to 9 per cent across the board for an indefinite period.

In a letter sent to parliament, President Nicos Anastasiades argued that the bill approved on December 3 violated EU legislation, the separation of powers, and would also have a huge impact on the state’s finances.

Anastasiades said the indefinite blanket cut would derail the state’s fiscal obligations as it was estimated to deprive the government of €75 million annually.

“In essence, the vetoed law intervenes and alters the fiscal policy, which is subject to EU law, and goes against the relevant provisions of the constitution, namely, article 167 (which specifies how the state budget is prepared and approved),” the president said.

Following Tuesday’s meeting of the House finance committee, an extraordinary session of the House plenary will take place with MPs voting on whether to accept or reject the presidential veto.

Should parliament reject the veto, the issue goes to the supreme court, which has the final say.

Prior to the presidential veto, the cabinet had approved a decree reducing VAT on household bills to 5 per cent for vulnerable groups and 9 per cent for the rest, for six and three months respectively, starting November 1.

Next week, at its first regular session of the year, the finance committee is set to wrap up discussion of the three government bills comprising reform of the public sector, particularly the aspect regarding the assessment and promotion of civil servants.

The same session will also discuss two bills relating to the licensing and supervision of companies managing non-performing loans.

These two sets of bills need to be passed by the end of January for Cyprus to qualify for the next disbursement of €85 million from the EU’s Recovery and Resilience Facility.

In addition, the finance committee will review the 2022 budgets of semi-governmental organisations. The majority of these organisations are currently operating on an ad hoc basis, since only five had their budgets approved by parliament during the budget debate in late December.

Also on Tuesday, the commerce committee is to discuss the matter of new bank charges which caused political controversy. Summoned to the session are the finance minister, the Central Bank governor, and representatives of the commerce ministry.

Meanwhile on January 10 the legal affairs committee picks up on discussion of a bill establishing an anti-corruption authority. A number of MPs had objected to the item as submitted by the government, arguing that the bill’s provisions rendered toothless the proposed authority.

Lawmakers will also look at a bill creating a framework affording legal protection to whistleblowers in the public sector. And they will revisit a legislative proposal seeking to stop serving MPs from engaging in any professional activity.

On January 13 the interior committee convenes to complete discussion of three bills governing the reform of local government, with the aim of taking the bills to the first regular session of the plenum.

And the House health committee will soon resume debate on the ‘Infectious Diseases Law of 2021′ that will repeal and replace the current Quarantine Law under which the government has issued the coronavirus-related decrees.

Following reactions by MPs over what they perceived as granting excessive powers to the state, the government withdrew the bill and resubmitted an amended version.